Zone Defense

No one knows the meaning of "You can't fight City
Hall" better than the entrepreneur who has tried, in vain--and
after the loss of many dollars and nights of sleep--to get zoning
approval to expand a business. Sometimes the zoning board's
objections are legitimate, if they're based on environmental,
historic preservation, traffic or other concerns. Other times, the
city or county zoning commission's decisions seem quite
arbitrary.

Theoretically, property owners have some leverage. The Fifth
Amendment says people should get financial restitution for the
"taking" of their property--in other words, the zoning
commission's refusal to let them do what they want with their
land. So business owners can threaten a lawsuit in federal
court.

That's a somewhat hollow threat, though. "Under current
law, the hurdles I would face trying to assert my property rights
in federal court are so time-consuming and expensive, it's not
worth the effort," says Donald Betsworth, president of the
North Carolina Home Builders Association, an affiliate of the
National Association of Home Builders (NAHB), a leading advocate of
legislation that would throw open the door to federal courts for
small-business owners fighting mercurial local zoning
decisions.

The Private Property Rights Implementation Act (H.R. 1534),
strongly supported by small-business groups, passed the House in
October by a nonveto-proof vote of 248 to 178. "The blood of
small-business people boils quickly when it comes to land-use
problems," says John Satagaj, president of the Small Business
Legislative Council. "This bill attempts to bring common sense
to the zoning equation."

The bill's key language changes the Supreme Court's
"ripeness" doctrine, which says a landowner can only
appeal a local land-use decision to a federal court (where the
landowner can ask for Fifth Amendment compensation) under two
conditions. First, the local zoning board's decision must be
final. Second, the landowner must have exhausted all avenues of
local appeal, including negotiating changes in a project to win
zoning approval.

H.R. 1534 allows the landowner to go to federal court after the
zoning commission has turned down the developer's first appeal.
Moreover, the landowner can avoid even filing that first appeal if
the chances of success are "reasonably unlikely." Current
law excuses an appeal that appears to be "genuinely
futile," a tougher standard to satisfy.

The Senate Judiciary Committee will consider the bill (known on
the other side of the Hill as S.1204) early this year. If the bill
is to pass Congress and survive a Clinton veto, GOP sponsors will
need more Democratic allies--and that means they will need to make
some changes to the bill as it moves through the Senate.

The National League of Cities and the National Association of
Counties oppose this bill, as do many environmental groups. John
Dwyer, acting associate attorney general, says the bill
"appears to be directed at local land-use issues, such as
where to put a garbage dump, whether to grant a building permit for
a liquor store, and how close a noisy industrial plant should be to
homes and schools." Local land-use agencies have historically
made these decisions, and the bill would take this jurisdiction out
of their hands. Echoing the bill's opponents, Dwyer says,
"There is no need to do so."

Time will tell whether small-business groups and supporters in
Congress can change their minds.

Stephen Barlas is a freelance business reporter who covers
the Washington beat for 15 magazines.